United States: Developer-Prepared Cost Comparisons Can Show Economic Infeasibility Under CEQA

Last Updated: June 4 2014
Article by Deborah Rosenthal

SPRAWLDEF et al. v. San Francisco Bay Conservation and Development Commission et al., (Waste Connections, Inc.) (1st Dist., Div. 1, 05/28/2014, A137619)

In a precedent-setting decision, the First District Court of Appeal approved the alternatives analysis used to support a massive 35-year landfill expansion in the Suisun Marsh.  Challengers argued that more evidence was required to reject a reduced-size, shorter-term alternative on the ground of economic infeasibility.  The unanimous three-judge panel held that project alternatives can be rejected as infeasible under the California Environmental Quality Act on the basis of cost comparisons submitted by a developer.

The 320-acre Potrero Hills Landfill is located in protected upland areas of the Suisun Marsh near San Francisco Bay.  Beginning in 2003, the landfill operator proposed to expand the landfill by adding 260 acres of adjacent land and increasing the existing 220‑foot fill height.  The proposal required replacement of approximately 6500 linear feet of Spring Branch, an ephemeral watercourse in the Marsh.  Most project opposition focused on whether there were "reasonable" or "feasible" alternatives to the project that avoided impacts to Spring Branch.

The project had a complicated approval history over almost a decade, eventually receiving nods from Solano County, the San Francisco Bay Conservation and Development Commission (BCDC), United States Army Corps of Engineers and a Solano trial court.  The final BCDC decision to approve the landfill expansion as proposed, except for a reduction in height, was at issue in this opinion. The challengers argued that evidence did not support reject of a smaller alternative that avoided Spring Branch in violation of both Suisun Marsh protections and CEQA.

The Court of Appeal applied the same standard for evaluating "reasonableness" of alternatives under Suisun March regulations as for deciding "feasibility" under CEQA.  Although the statutes used different words, the court found that economic "feasibility" under CEQA embraced the concept of reasonableness.  The court then found that economic infeasibility is shown when a "the marginal costs of the alternative as compared to the cost of the proposed project are so great that a reasonably prudent [person] would not proceed" with the alternative.

The facts are instructive.  The combined record before the County, Corps and BCDC showed the proposed 260-acre expansion would increase the capacity of the landfill by about 41.43 million tons, at a unit cost of $2.66 per ton, and extend the life of the landfill by 35 years.  Alternatives would have increased capacity by 7 to 10 million tons, at unit costs varying from $3.04 to $11.35 per ton, and term extensions of less than 10 years.

BCDC considered an alternative, supported by the project opponents, that would have reduced the expansion area by approximately 24 percent, reduced costs by 10 percent, lessened revenues by 45 percent, and extended the life of landfill by approximately 25 years.  The landfill operator explained that profit margins were around 9 percent, while expansion costs were largely fixed, but declined to provide further confidential detail.  BCDC concluded the 24 percent reduction was not economically realistic, and would not fully avoid impacts to Spring Branch. Instead, BCDC reduced the size of the planned expansion by approximately 10 percent, which was the minimum size the operator said would be "financially viable."

The court focussed on BCDC's ability to compare the economics of the proposed expansion with the various alternatives.  Specifically, the landfill operator submitted reports that compared, "side by side, the per unit cost, capacity, and life of the landfill for the proposed expansion and the alternatives."  The court opined that the "disparity in these figures is so great it amply supports the conclusion a reduced-size alternative of the magnitude necessary to avoid implicating Spring Branch was not economically feasible."  In other words, even without a full operating plan for every alternative or net profit analysis, the record contained enough comparative data to support BCDC's conclusion.

The court distinguished the adequacy of data submitted by the landfill operator from other cases where infeasibility determinations were found legally inadequate under CEQA.  In those cases, the court explained, the financial data was so lacking that no economic comparison could be made.  In this case, a reasonable person could have reached BCDC's conclusion on the basis of the available information.  The court had no problem with the fact that all of the information was submitted by the landfill operator, as long as the public agency found it was credible.

After more than a decade, the court decision removes the last legal barrier to expansion of the Potrero Hills Landfill.  The more lasting impact, though, may be on the amount and type of financial evidence that must be submitted to support rejection of alternatives under CEQA.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Events from this Firm
22 Oct 2019, Roundtable, Los Angeles, United States

Please join us for Sheppard Mullin's Ethics and Eggs: A Breakfast Roundtable to Discuss Ethics Issues in IP Matters.

23 Oct 2019, Other, Dallas, United States

Marketing Wants To Do What? Sweepstakes, Influencers, Loyalty, and Other Advertising and Promotional Fun

25 Oct 2019, Webinar, Los Angeles, United States

Matthew Bonovich will be a speaker at this webinar.

State and local governments continue to incentivize renewable energy and battery storage, causing an increase in mergers and acquisitions among producers and specialized renewables.

 
In association with
Related Topics
 
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions